Isis wallet just got thicker with Visa, MasterCard and AmEx

By Kevin WoodwardSenior Editor

The wireless wallet startup now counts all four U.S. card brands as backers.

The mobile payments startup now has the support of all four U.S. card brands.

Isis, the mobile-commerce firm started by AT&T Mobility, T-Mobile USA and Verizon Wireless, now is working with Visa Inc., MasterCard Worldwide and American Express Co., in addition to original payment partner Discover Financial Services.

The addition of the three other card brands is a significant move for Isis as it develops a mobile commerce system designed to let consumers pay in stores with a wave of their mobile phones past specially equipped terminals. Purchases will be charged to payment cards stored in the digital wallet. “This was inevitable,” says Rick Oglesby, an analyst at Aite Group LLC. “It makes sense for everybody involved.”

In May, Isis said it was dropping its original plan for a new network in favor of adding more partners. Indeed, Isis would have been constrained if it only offered Discover payment capabilities, says Nick Holland, an analyst at the Yankee Group. “There’s no point in having a wallet with just Discover cards in it,” Holland says.

The support of Visa, MasterCard and AmEx also bolsters Isis’s position as the mobile payments industry develops, he says. Isis, once it launches next year, faces competition from Google Inc.’s Google Wallet, PayPal and Visa, which is moving ahead with its own digital wallet.

Visa says joining Isis has no effect on its own digital wallet, which is scheduled to launch this summer. Isis’s approach to mobile payments complements Visa’s strategy, says Bill Gajda, Visa head of global mobile product.

“It’s going to be a fistfight for a while,” analyst Holland says. “Google might have the issue of getting their wallet onto handsets they don’t own.” Currently, Google Wallet is compatible only with the Samsung Nexus S, a smartphone designed with Google’s help. I can’t imagine AT&T or Verizon facilitating loading the Google Wallet onto their handsets.”

Oglseby agrees that Isis may have a competitive edge because of the backing of multiple wireless carriers. “From a consumer enrollment standpoint, it gives Isis a step up,” he says.

Partnerships such as Isis are laudable, Holland says. “But it doesn’t mean anything until they’re commercialized and we start to see real uptake from consumers.”

Consumers will get their first look at Isis—outside of tests in Salt Lake City and Austin, Texas—next year, which Holland says is too far away. “They should be doing this now. I’d like to see Isis commercialize this as quickly as possible and have the handsets available now,” he says.